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Brack-Friday Bunduru
Republic University
Minmatar Republic
0
   |
Posted - 2016.11.27 11:14:06 -
[1] - Quote
I'm having trouble understanding Broker Fees and Sales Tax.
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Say i'm buying an item for 100,000,000 ISK, selling it for 150,000,000 ISK.
The Broker Fee is 3% and Sales Tax is 2%.
This is my understanding:
1) Create buy order for item at 100,000,000 ISK - 3,000,000 ISK (3% Broker Fee) charged on top.
** down 103,000,000 ISK **
2) Item is bought for 100,000,000 ISK - No extra fees applied at this stage.
3) I relist item for 150,000,000 ISK - 3,000,000 ISK (3% Broker Fee) Charged
** down 106,000,000 ISK **
4) Item sells for 150,000,000 ISK - 3,000,000 ISK (2% Sales Tax) is Deducted
** up 41,000,000 ISK **
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Is this correct? |
Violet Hurst
Fedaya Recon
127
|
Posted - 2016.11.27 12:17:36 -
[2] - Quote
Almost, only that in step 3 the brokers fee equals 4.5M ISK (3% of 150M), so your net profit will only be 39.5M. |
Brack-Friday Bunduru
Republic University
Minmatar Republic
0
|
Posted - 2016.11.27 12:42:21 -
[3] - Quote
Violet Hurst wrote:Almost, only that in step 3 the brokers fee equals 4.5M ISK (3% of 150M), so your net profit will only be 39.5M.
Ah yeah you're correct, my mistake :)
Have corrected OP to reflect this.
Now the 3% is correct is this correct? |
The Larold
Living in Silicon Valley Is Too Expensive
61
|
Posted - 2016.11.27 12:48:13 -
[4] - Quote
Two main things to reduce tax and fee burden when trading:
1. If you are going to be buying / selling high-priced goods on the market regularly, and especially with buy / sell orders, I definitely recommend getting the 'Accounting' and 'Broker Relations' skills up to at least level IV as soon as possible. If you are going to be a career trader, training both to V is probably worth the few weeks of training. (Don't remap _just_ for these two skills though!)
2. As far as I can tell, faction standings really matter with the faction who owns the station where you do your trading. Corp standings matter as well, but not as much as faction as I understand. I used to be a part-time trader in Jita, and getting my standings up to 10 made a big impact on my long-term returns; reduced broker fees if I remember right. (It's been awhile)
Side note not directly related to taxes, but may help cash-flow:
You _may_ want to consider training a few levels of Margin Trading. Without this skill, when you place a buy order, 100% of your bid (desired purchase price) is removed from your wallet. As you skill up in Margin Trading, less and less of that 100% actually comes out of your wallet up front. When the transaction takes place, the rest of the money is taken from your wallet. |
Do Little
Virgin Plc
Evictus.
574
|
Posted - 2016.11.27 13:45:44 -
[5] - Quote
You can reduce transaction taxes to 1% with the accounting skill and brokerage to 2.5% with the broker relations skill. You can further reduce the brokerage fee - as low as 2% - by improving standing with the NPC faction and corporation that owns the station. If you sell at a Citadel market, the owner sets and collects the brokerage fee.
When you place a buy order the brokerage is determined by the location where you place the order, not the station where the order is filled - this means you can place a buy order at a Citadel in Perimeter with a 1 jump range so it can be filled in Jita and pay no brokerage if you own the Citadel - or whatever the owner decides to charge you.
Seller always pays the transaction tax. Person who places the order always pays brokerage.
You'll generally find better spreads in inter-regional trade. Perhaps buy orders for meta modules and salvage, sell orders for ammunition and drones at mission hubs. Reverse at a major trade hub. |
Violet Hurst
Fedaya Recon
127
|
Posted - 2016.11.27 14:06:36 -
[6] - Quote
retracted |
Brack-Friday Bunduru
Republic University
Minmatar Republic
0
|
Posted - 2016.11.27 15:25:43 -
[7] - Quote
Thanks everyone for the advice. |
The Larold
Living in Silicon Valley Is Too Expensive
62
|
Posted - 2016.11.27 16:19:05 -
[8] - Quote
Do Little wrote:When you place a buy order the brokerage is determined by the location where you place the order, not the station where the order is filled - this means you can place a buy order at a Citadel in Perimeter with a 1 jump range so it can be filled in Jita and pay no brokerage if you own the Citadel - or whatever the owner decides to charge you.
OHHH... I bet that's why I keep seeing a big market player that's always coming out of Perimeter, but setting it to 1-jump so trades can come from Jita. Brilliant. I just might want to get in on that action someday...
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